The Backtesting Engine That Made Me Believe in Feedback Loops

When I first built a backtesting engine for my trading experiments, I thought I was just writing some code to test strategies. It turned out to be something more like a life lesson in disguise. The backtesting engine is a simple idea: you feed it years of historical market data and a strategy, and it simulates every trade as if in real time. Win or lose, it reports back how the strategy would have done. I quickly became addicted to this loop of tweaking a rule, running the sim, and seeing the outcome. It was feedback on tap.

At first, I’d get frustrated. I’d tweak a strategy and run the backtest expecting a huge improvement, only to see a flat line or even worse results. But that’s where the learning kicked in: real progress came from iterative adjustments and patience. I had to develop hypotheses (“maybe the strategy should pause after two losses in a row”) and then let the simulation tell me if I was onto something. If not, back to the drawing board. If yes, the graph would inch a little closer to profitability. Each run was like a candid conversation with reality: “Nope, that idea doesn’t work” or “hey, you might be onto something here.”

This constant feedback loop changed how I think about building systems (not just in code, but generally). I started applying the same approach to other areas: try something small, measure the result, learn, and adapt. For instance, I treated my morning routine like a strategy: make one change at a time and see if my day felt better or worse. The engine taught me to respect the gap between making a change and seeing its effects. Sometimes you have to let a new idea play out for a while to truly judge it.

In the end, the backtesting engine did more than improve my trading algorithms. It instilled in me a deeper trust in iterative improvement. When you have a good feedback mechanism, you can afford to be patient. You make better decisions because you’re not flying blind—you’re listening to what the system tells you. Whether it’s in finance, coding, or everyday life, that’s a lesson I’m taking to heart.